2024 (12) TMI 866 - SCH - Income Tax

SC Upholds Revenue Petitions; Assessee Subject to Prior Judgment; Officers to Address Objections; Legal Remedies Open.

The SC upheld the petitions filed by the Revenue, referencing a prior judgment. The assessee is subject to the principles established in that judgment. ... Validity of reassessment notices/ proceedings - scope of notices issued u/s 148 of the new regime between July and September 2022 - Application of TOLA to the Income Tax Act after 1 April 2021 - Period of limitation for invoking reopening of assessment - Scope of new section/regime u/s 148A - what was the period of limitation available to “revenue” for issuance of notice under Section 148 of the Act? - As decided by HC [2023 (11) TMI 763 - DELHI HIGH COURT] After 1 April 2021, the Income Tax Act has to be read along with the substituted provisions, TOLA will continue to apply to the Income Tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income Tax Act falls for completion between 20 March 2020 and 31 March 2021, Section 3(1) of TOLA overrides Section 149 of the Income Tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under Section 148, TOLA will extend the time limit for the grant of sanction by the authority specified under Section 151. The test to determine whether TOLA will apply to Section 151 of the new regime is this: if the time limit of three years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(i) has extended time till 30 June 2021 to grant approval; In the case of Section 151 of the old regime, the test is: if the time limit of four years from the end of an assessment year falls between 20 March 2020 and 31 March 2021, then the specified authority under Section 151(2) has extended time till 31 March 2021 to grant approval. The directions in Ashish Agarwal [2022 (5) TMI 240 - SUPREME COURT] will extend to all the ninety thousand reassessment notices issued under the old regime during the period 1 April 2021 and 30 June 2021- And AO were required to issue the reassessment notice under Section 148 of the new regime within the time limit surviving under the Income Tax Act read with TOLA. All notices issued beyond the surviving period are time barred and liable to be set aside; HELD THAT:- These Special Leave Petitions are covered by the Judgment of this Court rendered in “Union of India & Ors. vs. Rajeev Bansal” [2024 (10) TMI 264 - SUPREME COURT (LB)] The petitions filed by the Revenue are disposed of. The assessee will be governed by reasons discussed in the said Judgment. AO will dispose of the objections in terms of the law laid down by this Court. Thereafter, the assessee who are aggrieved will be at liberty to pursue all the rights and remedies in accordance with law, save and except for the issues which have been concluded in the Judgment. The Supreme Court allowed the petitions filed by the Revenue, citing a previous judgment. The assessee will be governed by the reasons discussed in the said judgment. Assessing officers will dispose of objections according to the law laid down by the Court. Aggrieved assessee can pursue rights and remedies except for concluded issues. Pending applications are disposed of.